He does not get it… free trade is a failed ideology and will be replaced with far more controlled trade processes involving tariff and trade blocs and will be enforced by nation to nation deals not some world trade organization… citizens will come first not some new world global order that has mostly benefited the 1%

Wait until the Chinese population figure out that national organic growth through internal consumerism is the best future. We all need to learn that wasteful international free trade is bad in the long run for developed nations and the planet!

Trade will still exist …. but be far more balanced sourcing of true non- indigenous goods and materials rather than a free for all of duplicitous trading as it has been for the last 3 decades.

To get things moving and as usual north America via Trump will take the lead, and the rest will follow.

Another thing. tariffs don’t cost the tariff setting nation anything at all. The revenue from such a tariff can be redeployed into that nation by the government. The game is to stop wasteful imports.

Look… international trade should be a nations decision, not be the rest of the worlds god given right controlled by a purest yet out of date WTO.

I think we should send most economists back to school to learn to think, rather than let them keep parroting a failed religion to most past politicos who have been highly gullible.

Mr. Lin writes, “US consumer demand for daily necessities will not change simply by raising the costs of imported products.” Hardly all imports are necessities. And not all necessities are unavailable in America, especially if prices of imports increase. Nor is it to be assumed that Americans cannot and will not tighten their belts as prices rise and change the mix of their “necessities”. Unlike the loathsome members of America’s Congress who never say "no" to any possible increase in spending, and the complicit Fed with its run-wild printing machines, even debt-ridden Americans must eventually return to household economic reality or go to jail.

Mr. Lin concentrates the reader on “free” trade. Absent is even a word about the strange western concept of “fair” trade, laughed at in Communist China. Excluded from his article is the iron manipulative grip Communists hold on its unfree RMB currency and the Communist Party’s subsidizing and infiltration of all its industries. Trade is “free” when trade is advantageous to Communist China.

Trump is a bully and this is his way of negotiating, from the old book: set a super high target, and from there you negotiate down.

Western countries trade with China is unfair, which causes a lot of unbalances. Blocked markets to help local titans, mandatory tech transfer to enter the Chinese market, different rule of law for outside companies, IP cybertheft, dumping… the list is long.

All this had sense some years ago, when China was a 3rd wold country. China is not a baby that need to be taken care of anymore, it’s one of the world superpowers. The US and Europe have been trying to balance the situation with them for a few years, and Chinese have been all deaf ears. Now they finally got their attention and the negotiations will begin. Harsh, but effective.

China, please don't take up the mantle of promoting "free trade", unless we prefer to live in a system when rules are not never respected, social welfare is never adequate (money all goes to sustain zombie SOEs and internal security), environments are never protected by regulations and air quality index goes up to 10.

China has benefited a great deal from trade, but it has not and will not put it into practice, such as free economic activities or freely floating exchange of the renminbi, within the country because that would seriously undermine and risk the CCP's authoritarian, iron grip on the people and society. It is not because the leaders are communits but there is no other way to prevent China from falling into anarchy. The CCP's dynastical policy is the only way to keep China together. Read my (Michi's) comments, It Is Not China's Fault, nov. 16, 2015, on Michael Pillsbury/The Hundred-Year Marathon and American Humanis on Chinese Comfort Women, amazon usa. You would know something about Chinese society and culture.

The British debate on free trade in the first half of the 19th century was between landed class and rising industrialists. It was not academic discussion but it was a political contest, camouflaged in cosmopolitan liberalism or speaking from the Bible, concerned with each's opposing economic interests. It was also a kind of peace theory in international relations. But if the British had known it would help the rise of Prussia and Germany, the debate would have taken a different color.

When the WTO came into existence in 1994, the U.S. and E.U. owned 56% of global GDP and, because of the their huge markets, controlled the Uruguay Round negotiations that led to the WTO’s creation, which they viewed as a victory, in constitutional terms, for economic liberalism. In a memorable moment of triumphalism the US–never reluctant to claim victory prematurely– promised that China’s membership would transform it into a market economy and move it towards liberal democracy. China had requested membership of GATT in 1986 but it was not until 2001 that WTO members approved her accession (in Doha) after forcing her to accept reduced rights against other members compared to standard WTO rules, to open her markets, eliminate state monopolies on imports and exports and to significantly change her domestic laws, regulations, and practices. China was forced to agree to open its economy to competition and to overhaul its domestic laws, regulations, procedures, and administrative and judicial institutions across all levels of government, to make deep tariff commitments for imports, to significantly liberalize services and to agree that all regulations affecting trade would be nondiscriminatory and that government standard-setting would be transparent and based on international standards. China further committed to stringent IP protection and independent review of all trade-related administrative actions by judicial or administrative tribunals.

China had an uphill fight throughout but still managed to beat us at our own game...

I certainly agree that the Trump view of China as some kind of evil ogre stealing American jobs is rubbish. But I don't really see China "beating us at our own game" either.

The growth of China is simply part of a pattern that has been going on since the industrial revolution around 1760. The industrial revolution began in England, and has been spreading to new countries ever since. The spread to new countries is necessary because, as the world gets richer, it spends a growing fraction of its income on manufactured goods. Industry spread first to the rest of Europe, then to countries with substantial numbers of people of European origin, probably because the shared culture made the spread a bit easier. It then spread to Japan, because it had to go somewhere, and has since been spreading among the countries of east Asia. China is just a recent country in this long line, which should probably now also include India. Countries that industrialize late can grow very quickly because they can learn from the ones that industrialized earlier.

This is all just part of a natural process that is slowly reducing inequality between countries.

"The continued growth of US trade deficits, particularly since the mid-1980s, reflects monetary expansion by the Federal Reserve, which has inflated real estate and stock prices; thanks to the resulting wealth effect, consumption has increased and saving has decreased."

I don't get the argument. Surely the expansion of the U.S. money supply at least roughly is determined by the demand for U.S. dollars. Sure, the FED has expanded it a bit faster than demand, to create a little inflation. But why would this inflate real estate and stock prices in particular? Why would the small inflation that is created not affect all prices roughly equally? And if it does that, why would it affect propensity to save?

Answering my own question after a little more thought. I guess this makes sense. Quantitative easing, especially, created a big demand for assets like real estate and stocks. And even before that, the loose money conditions after the previous recession led to the housing bubble. It would be a mistake to blame the FED for these things, though. Without adequate fiscal stimulus from government, it had little choice.

"The US has long capitalized on its position as the world’s biggest economic power and largest trader to ensure that trade deals serve its interests"

Wow is that far off. Anyone familiar with the US trade deficit would laugh at such a claim. A better description might be the US was (and still is) the “designated loser” in world trade. There have several important studies of the impact of US trade policy since 2000. The titles tell you a lot. “Import Competition and the Great US Employment Sag of the 2000s”, “Trade Liberalization and Mortality: Evidence from U.S. Counties”, “Foreign Competition and Domestic Innovation: Evidence from U.S. Patents”, and “Putting a Smiley Face on the Dragon”. The contents of these papers tell a compelling story. US trade policy has been a staggering disaster for most (but not all) Americans.

Have the outsourcers benefited from “free trade”? Sure they have. Have the cheap labor exploiter benefited from Open Borders? Sure they have. Have the cosmopolitan elites benefited? Of course. Ordinary Americans? Not so much. Has the US as a whole benefited from "free trade". Clearly not.

"Free trade" is just a system where a few people gain from sending the USA down the drain. Nothing new about that. Did the UK gain from "free trade" in the second half of the 19th century? Clearly, not. Of course, the failures of "free trade" didn't exactly stop in London.

What British figure stated?

"Jesus Christ is free trade and free trade is Jesus Christ"

The would be John Bowring who started the second Opium War that ended with the burning of the Summer Palace.

PF, America is not poor. However, it has been decades (many) since living standards actually improved for ordinary workers in the U.S. Wages (including the minimum wage) have been falling for decades. LFP and drug addiction have soared. The U.S. has very serious problems that the neoliberal elite ignore because they like (and massively profit from) the status quo. We have a system where the elite shamelessly exploit racial/sexual/ethnic identity politics to maintain an economic status quo that is not working.

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